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The 50 richest families in America are betting on this trend

65m 33s

The 50 richest families in America are betting on this trend

This transcription features a conversation with a billionaire entrepreneur who founded Trilogy in the 1990s, an AI company that sold the first billion-dollar AI product using configurator software for complex manufacturing. After dropping out of Stanford, he built multiple billion-dollar companies, appeared on Forbes at 27, then disappeared for 20 years following his marriage. He is now returning to reinvent education with his own $1 billion investment through Alpha, a program that challenges children with rigorous physical and mental tests, such as kindergartners climbing 40-foot rock walls and second graders running 5Ks. He emphasizes that young people want hard, meaningful experiences rather than ease, which allowed Trilogy to out-recruit Microsoft for top graduates by offering intensive training like Trilogy University, which included a swap program with Navy SEALs. He also used unconventional recruiting tactics, such as requiring recruits to bet a month's salary in Vegas to test their risk tolerance. The entrepreneur attributes his success to intense focus, a willingness to do whatever it takes to achieve goals, and learning business principles from his father, a strategic planner at GE. He believes this same intensity and product management approach can transform education.

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I'm going to read you the most alpha sentence possible here. Kindergarteners must climb a 40 foot rock wall and pass a receive critical feedback without crying test. Right. This is the best time in history to be a five-year-old. Explore you. There you go. I feel like I could rule the world. I know I could be what I want to put my all in it like no days. Oh, on a road. Let's travel. Never. Well, I'm going to flatter you for a second. So the easiest one is I wish there was alpha school near me. So I could send my kids to it. I actually have a kindergartner, so that would be perfect. But you have this really amazing story. It's kind of the story that me and Sam like to tell in this podcast because it sounds like a movie. Here you've got this sort of secretive billionaire, right? This guy who in his 20s drops out of college, figures things out. You're on the cover of Forbes magazine when you're 27 years old and you built multiple huge companies, multi-billion dollar companies, and then you disappear for like 20 years. Nobody hears about you. You stay out of the public limelight. You're not out there like us talking on podcasts and saying how great you are. And then you take a billion dollars of your own money and you use it to try to reinvent education. Now you're back. Yeah. So in 2005, I got married, which was also the first year of podcasting. I did a podcast actually at Stanford. That was my last one. And then I went to the 20 years. And then now my youngest daughter is about to go to college. And so now I'm back on the road, right? I'm back in the limelight and I hopefully, the alpha will be doing it for the next 20 years to fix education. Why don't we start at the start there? So you have this idea for trilogy and you drop out of college. Actually, in high school, I wrote a paper about AI. And so a billion high school has read a paper on AI. One of the paragraphs said, "Nural mapped our decades away." I then went to Stanford and I was a class with the father of experts systems at AI, a professor, five of them. So my buddy's eye, we're like, we can't sit in Spanish class anymore. So we dropped out. Back then it was rare. And so the parents are not excited. My god, famous, you're more on. And then we built trilogy and are claimed to fame, actually, in the 90s. It was the first AI product to sell a billion dollars. Did you have the idea when you dropped out or you drop out and say, "Let's come up with a white board. Let's come up with an idea." No. We had the idea which was you could build this product called a configurator, which was experts systems had a range of things that they could solve. Configurator was one of the domains that they've been trying to solve at the late 70s, basically. And by the late 80s, I was like, oh, we can totally do this. I tried to figure out what Trilly G did because at one point you guys owned so many different products. I think you owned a bunch of different companies. And I was trying to figure it out. I was like, is it sort of like if an airline needs to buy parts to build an airplane, you built software that would help them decide how many bits and pieces for each, how many seats they need. Therefore, what they should order from the manufacturer, was that right? The first product we had that started the company was a configurator. Just think of a configurator on a car, website, or Dell computer where you're configuring your computer. Now, just imagine it if it's a million times more complicated, which is a room size phone switch or a Boeing airplane, or back then main brain computers, big manufacturing systems that the problem back then is the reps would be out in the field selling these complicated products. And then what would happen is they get to the manufacturing line and the main factory line and build them. There was an unbuildable configuration. And so being able to take that knowledge of how what is a correct configuration, put it in your thousands of sales reps hands so that it would sell accurate configurations, would say millions of dollars a day to the Fortune 500. So we just found all the Fortune 500 manufacturing companies and said we can take what all this huge problem was costing you just eight zillion dollars, put it in this sales builder, which your sales reps would be able to build correct configurations. And then you'd pay us millions and millions of dollars for it. And so that was our first product. And that's what launched the company and that was the first one that drove the billion dollars revenue. And you're at the time, you're only what, 20, 21 years old, you're saying like a simple, we just went to the Fortune 100 knocked on the door, they handed us millions of dollars. Beat pop. Beat, beat, beat, beat, beat, how easy could it be? So what was it actually like when you were doing that? I mean, were you just like really savvy early on to where you make and dumb mistakes, but figuring it out, can you take us back? Yeah, well, there's, there is, you know, if you want the long form, there's actually a 2,000, 5,000 gas, where I was presented to Stanford about why if you're doing what we're doing, it's the dumbest thing you could do, but you got to try it anyway, which is, no, the Fortune 500 does not want to buy from a kid dropping out of college, right? And we lived painfully, it took three and a half years, but the flip side to it, if you ever build a product that the 4,500 wants and it saves them, you know, hundreds of millions of dollars, they will buy it for me. Does it have no other choice? We went into multiple sales cycles where, you know, they'd go in and at the end of it, they'd be like, oh, we're going to go higher back then, Anderson consulting, or we're going to call, you know, one of these Oracle to solve this problem. And when those companies couldn't solve it, they would come back to us. We were the most expensive software you could buy in the 90s because we also had super high pricing because we're like, they're not going to buy from us unless they have to. And we know it's worth hundreds of millions dollars, right? We are the last choice on the list. And the way they are like, okay, we got to deal with these guys. Then you're like, great, I'm going to charge you lots of money because you have no other choice. Well, that's not a very young kid mentality. Every time that I've read about you, you've had this confidence that I love. And it seems like even what you're describing is a very confident move for a very young person to make. And back to, there's some background that helps on that is Jack Welch who was CEO of GDE. My dad was a strategic planner. And so I grew up in that GDE culture. And I remember telling him, my dad was like, God, that's just TV. They're like the only cool thing you guys made. And he's like, oh, let's talk about the gross margin of a cat skater versus a T commodity TV. And so I was learning all of that from a young age. And so that helped when I was ready to start my business that I understood ROI and that I was going to be self-value and all of those things. But then I took that and said, I'm going to be the best product manager. And I'm going to put the two together. And I actually think today with Alpha, that's a lot of what I'm doing. It's just taking the product management part and the go to market, is this part in saying, if you took those two things, how would you change education? Can you put some things in perspective? So I used to live in Austin and a bunch of my best friends are Austinites. And at one point, I don't know if you know the Sean, I think at one point, trilogy was the largest or a top three largest employer of folks in Austin. And like your growth was like astronomical. I mean, I think that you're doing hundreds of millions in revenue and only like five or six years in. Can you sort of brag for a moment? How big and how fast did you get? Well, so once we had, it took us, you know, we dropped out. It took three and a half years to actually build the product and convince anybody to buy it. But then as soon as they started to buy Silicon Graphics, bought it, Hula Packard, bought it, AT&T IBM, right? It just, we started a roll through the biggest companies with, you know, massively, you know, high pricing. On the show, we have spent hours talking to some of the best investors alive. Well, lucky for you, the team at HubSpot, they have pulled out the principles that matter most and turned it into a very simple, easy to read, wealth guide. It's 35 principles from the top investors. We're talking guys who have been on the pod like Howard Marx, Maniche Pabri, Morgan Hausel, Kathy Wood, and a ton of others. So these are all their frameworks, their mental models, their rules, basically how to play the long game and how to avoid ruin. You can get it in the link below. You know, we were in Austin where they didn't have lots of software engineering back then. So we hired 2,000 Ivy League graduates, you know, MIT and Stanford and brought them to Austin. So our claim to fame with the 90s was if you ask Microsoft, you know, and Bill Gates, who's the only company who outweighed us out of college, right? They were at their peak. So Microsoft would win 90% of college graduates back then and we against them 170%. Bill Gates literally flew down to Austin to figure out why we were getting the best graduates. And this is also how intense he was is where it did her and he's literally going through every single person that we had made an offer to. You know, there's Fred here and you're offering him back then, you know, $48,000. You know, and we sort of reversed and cheered how you guys, huh? You know, we think he's like a $38,000 guy. You know, why? What was his technical capability that you really liked? I mean, it was great. The level of detail he went through, right? Because it was a fight for talent. And if you're getting talent, you got to get the best people. What was your response to Bill Gates during that dinner? Well, no, yeah. When he said, well, let's it, Bill, here's, here's how you do it. Well, what did you say? Well, what it was, he's like, I will call. He's like, after leaving. He's like, I'm going to call every single candidate who has a trilogy offer and a Microsoft offer. And I'm personally going to call them. And I'm like, I need the candidates more than you do, Bill. And I, you just, just, I'll just escalate. I'll just escalate. I'll bring them on a trip and we'll do a week's ski trip. And I'll ask them, how was the last time you'll ever talk to Bill Gates? How was that called? Because he's never going to have time to talk to you again, because he's got thousands of employees. And so the thing did for the period in the 90s, right? a would have, you know, whether it was ball or Mike Maple, the other third in the Office of the President, those three would call all our candidates, and we would just continue to fight, and it was wrestling, right? It's just we needed them more than they did. This is one thing I wanted to learn from you, 'cause when we're talking to you right now, you seem like a friendly, nice guy, you seem like a normal dude, but you definitely have a gear that most people don't have. Can you talk about that extra gear, which is some version of boldness or intensity? Yeah. You set out, you have a goal, and you just do whatever it takes to achieve the goal. And there's no amount of work you wouldn't do to hit the goal. Just like this, I have to win the recruiting award, I have to win. If I don't beat Microsoft and get the best talent, my company's doomed. And so, whatever it would take, right? And I think that's true. You know, for everything that you want to do, you just have to have, in fact, to that gear, I had been lucky enough that I do find what I loved work on. So I loved building the stuff in the '90s, right? And it was awesome. And so, I was loving every minute of it. And, you know, if I look at what I'm doing with education right now, I have the best of in the world. So I'm working seven by 24, you know, on education. And there's nothing that we won't go do to figure out how to go fix this and get this to a million people. And I think just back to entrepreneurs, they have that gear, right? And Bill Gates has that gear. You know, today is the world's best out its Elon, right? You know, when you go to dinner with him, you're just like, oh, I suck. Like he is so much better, right? That his level of intensity and working on the most important problem and being able to focus on it is just a critical skill. And if you want to story, I guess, going back to the early days. So my dad had terminal cancer. But he said, you know, look, you know, I basically have 18 months. How about I sit on your board and help you, you know, figure it out. You're like, young punk who doesn't know what he's doing. But it was obvious that I had, you know, caught the tiger by the tail. And, you know, there was a meeting where at this massive deliverable we had to hit Figuila Packard. It was one of our first one in HP's, you know, yay, our name was everything. And he's like, is your entire company focused on this? And, you know, we have the board for you. Absolutely. Of course we do. Totally focused on it. And he's like, so you're an engineering team. Like if I asked him, you know, what percent of their time do they focus on Figuila Packard versus all the other companies? And I'm like, 100% on Figuila Packard. Everybody understands we are not going to miss this. And he's like, real? Okay. Stop the board meeting. Goes out and says, good. Figuila Reed, who ran our development. He's like, bring him in here. You've got a lot of customers, Bill, you know, work it on this stuff. What percent of this team is working on Figuila Packard? And Bill's like, well, since you come from traditional work, you know, traditional world, I would generally say 200% because we're working 80 hours a week. Every single person's working 80 hours a week on Figuila Packard. And that leaves us an extra 20 hours of a week to work on, you know, the other customers. Right. And that's the kind of thing where, you know, when you're talking about intensity and focus, right. And your team trying to deliver on it, right. It's just, it's, you know, and I was like, oh, like great. You know, you're like, hey, dad, have you ever seen me kiss a girl man on the lips? Because it's going to happen for the first time. That was right. And that is exactly the, when you talk about intensity, would you're trying to solve this? Right. I heard a story, though. It's not just intensity. I heard a story. I don't know if I heard it through a friend of a friend or online that you would take people. People you were recruiting, like, like at the end of your university cohort, I forget what you called it. And you would take them to the casino and you would give them some money to gamble. And if they, and you wanted to teach them, they wouldn't want to gamble a lot of money. And you're like, well, you're not a good fit. We need the people who are going to gamble more. Well, actually, so this, you can go look, there was a cover story in the Wall Street Journal about this. Because it was actually their money. And, you know, we get all these kids down and they're like, I want to be an entrepreneur. I'm risk-taking. That's who I am. I'm like, great. So at the end of our Trilje University 100 days, you know, if enough of the teams that hit their goals, we would take everybody to Vegas. And then we would get everybody around a roulette wheel, right? And we'd say, you have to bet one month salary on the number, right? And so everybody would have to put one month's salary down. And, you know, there's a lot of people who are like, well, I'm not, I don't want to bet one month's salary up it. And we're like, first of all, that's not a huge risk. You're going to be asking a venture capital to give you millions of dollars. And you're literally not willing to take any risk at all. And so we would weird that every year. And the Wall Street Journal wrote this big story about it. I actually got a lot of flat from parents after they read this story. They're like, what are you doing? You just got out of the college. But yeah, back to just, you know, pushing people. You know, if you want, here's another intensity. We actually Trilje University, you know, there's Harvard Business, you know, case studies on it. And you read about it. But we literally had a swap program with the Navy Seals. Literally the Navy Seals are like, okay, you know, we're going to send a couple of our seals over to your program. And you send a couple of your Trilogy kids to California to go part, to be part of ours. It was sort of his whole versus the mental. And, you know, it was that level that we were considered by the seals. The only thing on the standard and rigor that would equal them on the physical side. And kids, you know, back to recruiting kids when they would, oh my God, I get to go do, oh, they don't last a week, you know, really a few days before they. Yeah, is it easier? Is it easier to make a meathead good at programming or a nerd good at like swimming? Goldwater. The seals are actually super smart, right? They filter, right? So they were coming in as super capable. Now they never been in an environment where you're having to make it was the kind of thing of a different environment of decisions and things like that. And then there are other ones. But it was, you know, is those kind of things when you talk about intensity and doing things that are non-traditional. I'm all about that, right? It sounds like on the recruiting side, you also did some encounter intuitive, right? Instead of making it easy, because when I moved to Silicon Valley, it was all about ease. Google, do your laundry, they'll cut your hair, they'll walk your dog, they'll give you free food. Do you want some more free things that I went into a vending machine and it gave me a MacBook. It was unbelievable. But you were like, you realize that actually young, ambitious people wanted something hard, not easy. Can you talk about that a little bit? That's a huge insight, which is this is the hardest hundred days of their life. And that was what allowed us to recruit them against Microsoft or all these other companies. I was actually at the board of directors of a fortune-tale company. And we had taken some of their Mac ease who wanted to go to the trilogy instead of their company. They're like, how are they going to this little company? You know, instead of us. Yeah. I'm like, well, during the internship, you made it easy, right? And so they're just, oh, I'm not doing anything significant. And when they come down to trilogy, it's going to be the hardest thing they ever did. They're going to work on something significant. And he wants to do awesome things, right? And mapping it now to our education. We talked about the kindergarteners, the Clinton 40-foot rock wall. It's the same thing. Can't want to go do hard things. Now, they need to be supported through it. You can't take a kindergartener. Say, good, right. You need to sit there and you have to have high standards and high support. You need both parts. You know, we have these, you know, we've alpha tests where you do all these easy workshops. You know, and then you have to test to pass it. You have a Clinton 40-foot rock wall. You know, our second graders got a run of 5k. Our eighth graders have to do a tough mother. Or they also all have to cross the finish line at the same time. You know, we have all these tests. But the ones that drive back to the most excitement, I mean, they all are hard. Are the ones where the kids can beat their parents. Like, there is nothing that motivates a student more and a kid more than them being able to go head to head with their parent and Winnie. Like, fair, not with a parent-tank bit. Like, they love that. Kids love that. One of our claims on the, you know, is kids love school more than vacation. Right. I can't build a school that kids love more than vacation if I have low standards. It is the reason they're excited. It's because they're going with their friends doing hard things. I actually think, Sean, this insight that you guys just came up with is actually quite brilliant. And you did a really good job of tying it into alpha, but like of making things hard. And that actually attracts a certain type of person. But what's interesting is like, if you're a kid, it's exciting to climb a 40-foot wall. It's exciting to beat your mom and dad. When I think of like a configurer software, that's not like that exciting. Like, that, you know, it versus Microsoft, if you're making like, well, Microsoft's not terribly exciting either. But if you're like Apple, you're making like the iPod. You're like, you know, we're rough. It's like this consumer product that I can hand to you. How cool is that? Or we just talked to the guy who founded MTV and he was recruiting these people. And it was music. It was entertainment. That's cool. Configuring software. That's not that cool. But yet you said we're making this awesome stuff. Can you dive deeper into what makes something awesome? Because that, I actually think that that one trigger of like making school awesome, making trilogy software awesome. Like other than making it hard, what is necessary for something to be awesome? Yeah, sure. So you're never going to convince anybody that configuration is sexy. Right? Versus all the other options. However, the AI algorithms that underlawed configuration at the time were some of the most important. complicated computer science problems you can solve. And so when you're sitting there and you're looking, "Oh, I'm gonna go do an about box for Microsoft Word." As choice A, or you're gonna go work with the smartest people tackling this challenge that no one's been at solve before. Right? It is a technically impossible challenge. And the best computer scientists, like, you know, in 1985, writes Stanford MIT. Their number one computer scientist all came down, or graduates, all came to Alpha. Right? And that is because we were working on the hardest problems. It's the same thing, you know, people always ask, you know, when, you know, on companies, why do people do startups? Like, why do they go to down to SpaceX? Why do you do it? And it's like, 'cause I'm with other people who are super smart, who are working hard, and we're all trying to do something that's really, really hard. The Navy seals, why are you joining the Navy seals? Right? It is the camaraderie, it is the, you know, it's everybody together. That starts in kindergarten. It starts in kids' love this stuff. Right? And it goes up to, they're getting out of college, and then late career, like the people who are joining us, you know, who are, you know, my generation of my age. These are people who are like, okay, I'm gonna go spend the next decade trying to fix education, and it's gonna be a nightmare. It's gonna be super hard, right? But they wanna get in and do it because the alternative is, oh, I'm gonna tire in like, all full day. And, you know, the challenge and the excitement is what motivates people. You said something earlier about high standards and high support, I'm gonna talk about high standards for a second. (upbeat music) All right, let's take a quick break, and I got a question for you. When a buyer asks AI for a solution like yours, does your business come up? Most companies have no idea. And by the time they found out, they've already lost the deal to another company that did HubSpot has AEO, which helps you show up in the moments when the right buyers are looking for a company like yours, before the first click, before they fill in the form. That is the moment HubSpot AEO is built for, check out HubSpot.com, the agentic customer platform for growing businesses. (upbeat music) I was at a Tony Robbins event a decade ago, and somebody was, you know, all these people come to Tony Robbins. Some people who are at the edge of their craft, at the top 1% performers, they're there to get that edge. And there's some people who are, you know, on the edge, you know, broken and, you know, they're looking for a fix. And he said, if there's three words that would solve every problem you have in this room, it would be raise your standards. And he basically said, you know, your life will be what you tolerate. And he goes on, he gives him much of examples. David Pro was telling us, he said that, you know, Joe once sent me as a holiday gift to bottles of wine. And it's the note on it said, here's two hundred point bottles of wine to remind you, something like that, to remind you of what 100 point looks like, a reminder about standards. Can you talk about what that means? 'Cause it's easy to say, it's really hard to do. - You can't get higher than the hundred points, right, on a wine ranking. And it's the same thing on a test. Like our kids, Alpha, get hundreds on their tests. If you go to your average parent and say, you're kicking it 100 on the Texas star. 95 plus percent of parents, so I know they can't. They can't do it. And, you know, we have a building with a few hundred people in Austin who get more hundreds on the Texas Ardent, a school district of 100, that was them. And all you up do is just show kids they can. Right, now you also have to support them and show them how to do it, right? But the back to the motivation of what should the standards be? Right, and the standards that should be are we should get a hundred. You should know everything, right? You should be great at your craft, right? Whatever it is. And who wants to be number two and off of those motivations, right? That drives human potential, human nature. And when you're building a business or with a school, it's the same thing. How do you instill that in your team, though? Is it just about being a sort of Steve Jobs asshole where nothing's ever good enough? No, it's the exact opposite, which is most parents are one or the other. They are either high standards, low support. Just throw your kid in and figure it out. Good luck, right? And that's what's gonna cause grit. These are just gonna keep struggling. Okay, that's it. That's the only way to do it. Because, still try a little for a little bit, but then they'll decide it's too hard and bad, right? And you get tons of disengagement with that path. You can do the other one. I'm high support, low standards, which is, oh, I don't ever want stress, right? But I'm gonna be there supporting the whole time and we'll do it. And that's terrible because you never learn how to do hard challenges. You never learn resiliency and grit, right? You never get stuff confidence 'cause you never tried something hard that you struggled to. And so you have to give the scaffolding and show people how they get there. - What does that look like with an accompany? - Yeah, let me give you the school one and then I'll give you the company one, which is, I go to the seventh grade as my first year. I'm like, all of you guys can get 100 on the test star and then I can just leave them on the test and possible. No way. Can't get 100. I'm like, no, no, no, I'll give you 100 dollar bill, 100 for 100, right? I know it's still implausible, can't just, right? I don't know how to do it. And I was like, no, no, no. Here's the catch, any grade left. And they're like, you're gonna let me take a kindergarten test and give me 100 bucks for a Texas 100 dollar star. I'm like, well, they start in third grade. And so the kid's like, done. Goes and takes a third grade test, it's 100. They're like, can I do fourth grade? And you're like, absolutely. They do fourth grade. And then they be fifth grade. And they only get an 82 because they didn't know all that they hadn't done their school, and not given the mastery right through it. And this is where you have to give this scaffolding. Do you want the AI to do to look the ones you miss and give you those lessons that will get you to 100? And the kid loves to add it and is like, ah, that's like gonna take me a week or work. Sure, for another 100 bucks, I'll do it. And then they do fifth grade and then sixth grade. And by the time they get to seventh, what you manage, you change their mindset. When you're getting 100s, all the grade levels, you're like, well, obviously I can do fifth grade. I obviously can get it to sixth grade. It's just a matter of work. And then it's just a matter of work to do it in seventh grade. And so you've taken a kid who thinks it's impossible and you give it a scaffolding to work through plus motivation because motivation matters. And you give them scaffolding and motivation to do it. So if you're building a company, it's gonna be the same thing. Go build a billion dollar products. Okay, that seems hard. You're like, what is the scaffolding? You're giving your team where you're making it where they understand, okay, I know how to get it. And that's the part when you think about high standards. If you as a company give high standard with no support, they don't have to get there. They'll try for a while and then they'll disengage. Lots of companies are trying to move their companies to be AI first, right? We want to be an AI first company. And they're basically like here, here's, you know, log code, good luck, right? And what is the scaffolding you're gonna be able to do to get your people to that standard? Are you able to sit there and role model? This is what excellence is. This is what we mean by excellence. And then once you show them, here's how you, if you don't have the skills, how you can repeat it. And so that's the part when you look about, you know, this is HR, is, am I getting the people in who have the skills to do it? And then can you give them the training and the motivation model where they want to? - You are very good at understanding how to get people to do what you want them to do. Did you learn how to do this because you wanted to build an awesome company? And you're like, I got to figure out how to motivate people and how to make them productive or were you always into human psychology and business was a good example of just making it work. - So no, I was not good with human psychology. And I did want to build the company and how I got there is one of the most important hires I ever made is Guy Jim Able, who was my head of HR, who would coach me through a lot of this, where I started very much as high standards low support. He was the one who was like, look, here's the part, here's what you have to do if you want to bring your team with you. Here is the organization you have to build. If you're going to bring, once I had, you know, 2,000 employees and I'm like, oh my God, you know, what do I do? He was the key insight on that side. And then, you know, on the school side, now there's this, the professor, Dr. Yeager, who's written a great book that every parent should read, which is called 10 to 25, the science of motivating your kid from age, 20 to 25. He's the one who actually developed our child development side and how our adults are dived and work, which is he meant her mindset, high standards, high support. And he's done a ton of studies that actually show literally with wording changes, where you can take a student and just say, look, I'm about to give you feedback. That's gonna be hard. But it's only because I know you can go crush this, right? And because I know you can do it back to the, the Tony Robbins part, right? The growth mindset. And it's, I'm giving it to you because I know you can do it. And so here's what you'll need to go do and you can then give them the coaching. Back to that book, 10 to 25 is a, every parent should read it. And it actually is our model where people say, how does the outfit work? It only has a 305 reviews on, it's not that popular. It looks like, the books, once you get to middle school at Alpha, you have to read 10 to 25, there's another book, Self-Driven Child, that we do not allow kindergarten moms to read because it talks about you being independent. And a kindergarten is the last thing you want to worry about. But once you get to middle school, where I ask where kids, you have to, they're moving independence. And so those are the two books that drive our model. Talk about simplicity, because as you're explaining things, I feel like you're taking big ideas your compress. in a great way that makes it easy to sort of, you know, rock, giving us good frameworks. I used to do big, you know, 20 page strategy documents. Here's our big strategy documents. And, you know, when Jim joined, he'd like read this document. He's like, "Joe, this is useless." And be like, "Mm, it's really not. It's like really good strategy. What are you talking about? The things are super awesome." Like, what are you talking about? What's wrong with you? Awesome. And literally, I'm like, and then he's like, "Oh, when you think, you know, he's like, "Joe, look." You have a couple thousand people now. Your strategy document has to come down to three lines, three words each. And I'm like, "Now, how could I make a strategy to give this complex tech company slogand? Like, we're not going to use slogan Eurin to get there." I was, I literally went to what I co-founded. I was like, "God, when we hired Jim, it was really smart. But why would he like try to dumb this app?" And I remember thinking about it, right? And so he kept coaching me on it. And like, guys, these are like Stanford and Harvard Christ. They can free you to 28-stats, Strasuedoc. And he's like, "No, well, the next we're going to have a company meeting and you're going to get up and, you know, slogan, what are your key phrases?" I just was like, "I'm not going to do it." So he interviewed everybody in the company, literally back to intensity. He was like, met with every single person in the company and then put on the board after, I took him over a month. And he's like, "Joe, this is what your company thinks you're strategy is." I'm like, "Wow, that's like the opposite of what we're doing." And he's like, "Exactly. You said the problem with the 28-stats you're talking to me. This every single employee takes the one sentence that they can attach to. And say, "See, I'm aligned." Right? I'm aligned. And when they're really not, and then that's you just lose, right, you defuse all your focus. And so he tried to reverse engineer. Yeah, there's three lines of three words to each. And I was like, "Okay, they're definitely not that, but here I'll go." Now I understood and then we created it. And that now for everything we do, right? So what is it for alpha? What are your three lines? So our three lines for alpha are for every student, right? Every parent understands. We make three commitments to every kid. The first is, you will love school. We used to just take a survey, do you love school? That's 96%. And so it's too easy. So we added one 18 months ago where we say, "Would you rather go to school or go on vacation?" And four weeks ago when we surveyed all our kids, 46% of our students said, "I would rather go to school than go on vacation." Right? So great high standard high bar or delivering love of school. The second is, you will learn twice as much in two hours a day as if you sat in class for six and then homework. So that's our learning engine does, you learn Penton Saster. And so we don't make you do a whole day and learn Penton's as much. We're like, "No, we're going to shrink it down." You'll learn twice as much. So no matter where you start on a percentile level, we'll get you to top 1% if you're in the system long enough. Right? If you give me time, we're learning twice as fast. I get to go beat the top. I can get 100 on the Texas stars and catch up. Even if I start in the bottom 25, right? You can move up. And the third is, we use the rest to teach all the valuable lifetales that kids are going to need to thrive in this new world. And that's, you know, leadership and teamwork, entrepreneurship and financial literacy, storytelling and public speaking, relationship building, socialization, grit and hard work. And so those are the skills, but those are the three things. So if you're coming to Alpha, why are you coming? Right? It's putting together a very simple clear product message that everybody understands. And the wording, the part that Jim was really great about when you do this, when he's like, it's not sloganering, which is if you can't say the opposite of it, right? Then it's not on the list. Like so when we were doing the core values of trilogy in the 90s, I was like, well, we obviously have to have integrity on the list. And he's like, though, is there ever a company in the world who's like, I'm going to beat the non integrity company? He's like, those are wasted words. Those are nonsense words because they mean nothing. He's like, I want edge, right? They have to have edge. And so like school is a great one. There's lots of people who don't think kids should love school. They're like, well, where are they going to learn grit and all these things? That love school is antithesis. I remember when I put my kids in the Alpha 10 years ago, McKinsey and Brian were actually the ones who started it. And I was like, I am. What is the thing I don't know about education, you know, that he's like, well, first, kids must love school. And I'm like, yeah, sort of like spit. You know, I didn't like school and you just sort of suck it up. And that's just part of the game. And he's like, you're only wrong. And that is completely true, right? My number one people want to, you know, talk about how they can use time back or software. And the number one question I asked of every head of school now is, are you willing to rebuild your school so kids love it more than vacation? And if the answer is no, I will not like use the software. It's all due to it because it's not going to work. Can I ask you a question that sounds really stupid, but I think you'll have a really good answer? Why does a kid need to learn two times faster? It's not stupid. I get it a lot. Everybody's like, why two X? There's a couple different dimensions. Let's talk about it. The first is, you know, kids spend six hours a day plus homework today, right? They spend six hours a day plus homework on school. And so the answer is, if I can build a product, a technology, let's kids learn in half a time. Shouldn't we do that? To the point of the name of our product is time back, which is we want to give kids their time back. And right now we suck up 12 years of kids' lives, sitting in class and doing homework. And in the old world for, you know, for 100 years, there was no other alternative, right? And now, because of learning science and generative AI, you can literally build an engine that teaches kids 10 times faster. So you're like, well, okay, let's do it. Why wouldn't we? And, you know, back to obvious simplicity product positioning. There's a question of whether it works, but once you believe it works, right, and you get the results that show it works, who wants to have their kid be in the six-hour learning instead of the two-hour learning? Because then your kid can do other stuff, right, the rest of the day. How big is this going to be? Because I'm completely alpha-pilled, not from this conversation, but my kids are both an elementary. I volunteer in the schools maybe once or twice a month. It's a great place, but it's very much like a bundle of daycare, a little bit of education, a lot of learning social stuff. That's great. But in terms of just like the learning and the life skills, I don't think it's anywhere near what's possible. And when I heard about alpha, and specifically this, the 5K story, it was like, "I'll be away." I was supposed to like the AI part, and instead I loved the part where it was like, cool, after they do the two hours, they had this thing where it was like, I don't know, second graders or something. It's like, who here thinks they can run a 5K? Nobody raises their hand. So they don't believe themselves that they could do it. Hey, parents, who thinks that if their kid had to run a 5K right now, they could do whatever, first grader, second grader, whatever it was. And nobody raises their hand. And over the course of whatever, some amount of time, they were like, well, great, can we walk a quarter of it right now? And then they walked a quarter. And then they were like, yeah, that was, can we walk half? Can we jog a quarter? And they basically did what anybody would do. And they sort of trained their way up, and the kids all did it. And they were able to do it. And I just thought, man, that's a kind of an incredible experience. I want my kids to have that type of growth and opportunity. So I think this is going to be big, but you think about this all the time. And you've already built companies that are multi-billion dollar companies. So how big is Alpha School going to be? 85% of Alpha parents say, I thought my kid do something in the last 10 weeks that I thought was impossible for their age. This is for the folks out there who have a business that does at least $3 million a year in revenue. Because around this point, that's when you're able to look up after being heads down for years building your company. And you realize two things. One, you've done something great. But you're still a long way from your final destination. And two, you look around and you realize, I am all alone. I've outrun my peers, which means you're now making $10 million decisions alone by yourself. And that is when mediocrity can creep in. My company, Hampton, we solved this problem by giving you a room of vetted peers, of other entrepreneurs who are going to hold you accountable, call you out on your nonsense, and help show you the way. Because the fact is, is that there's only a tiny number of people in your town who know what you're going through and who have been there. And they're hard to find. And if you can't find them, it's hard to have this explicit time, this explicit place, where you sit down where the rules are clear that we are here to help each other and to be one another's board of directors. The biggest risk is not failing. You have a company in its working. You're going to be fine. But the biggest risk is waking up 10 years from now and saying, "Shit, I barely grew and business and in life." And for people like you who are ambitious, wasted potential, and regret is what we want to help you to avoid. We have made so many of these groups and we have a thousand plus members. And I know this stuff actually works, whether you work with Hampton or you get your own group on your own. But having a group like this, a group of people who you meet within real life once a month, it can change your life, it changed mine, and I know it will change yours. So check it out, join Hampton.com. We as parents because of the old system and learning 2X or 10 times or learning these life skills, running 5Ks, climbing 40 foot rock walls, launching businesses, you know, Broadway musicals, Broadway musicals. Our expectations of what kids do is much lower than what their capability is. Right? The greatest untapped resource on planet earth is human potential. And we now have the first chance, right, in 100 years, to re-invision it. And what we're showing at Alphys, these kids can do 10 times more than we expect. I believe how big this is gonna get is, my view is I'm just 20 years and get this to a billion kids, right? And it is gonna utterly transform education, for everybody that when you think about AI is gonna transform the world, right? There is nothing that is going to have. There's no part of the world that AI is gonna have a big impact than education. It is the unmitigated win, right? This is the best time in history to be a five year old because the 12 years ahead of you are gonna be great. And so there's lots of work to do, right, to do that. But I believe that once you realize what's possible and why we get all the, what we're showing with alpha, so once you show this is possible, there isn't a parent who doesn't say I don't want this for my kid. - You were silent for the last 20 years, but you've been quietly building that. Why weren't you talking then and you're talking now? Is it just because you need to influence parents to give their shot? - So there's two parts. One is 2005's also the year I got married, which was the last time I talked. And so, you know, in building the family being in the line lights harder, right? It's easier if you just quiet. And second, it didn't help the business. So in the 90's, it really helped the business, didn't help the business after 2005. And then now for this, it absolutely does, right? The biggest impediment to change in education is the parents, right? Because all we know, right? We're fish in the water. All we know is the education system we went through and our parents and our grandparents. And so there's just massive resistance to change, right? There's disbelief, right? Our marketing department, you know, their slogan is, we educate the parents, right? Because nobody believes this. Like, you listen to one of my podcasts, the number one feedback is, well, I don't believe kids can learn 10 pounds faster. I don't believe these kids really love school more than vacation, right? And so back to being out there and getting the message out, I consider it critical and education historically hasn't had that. - To do a billion students, you need like 10 million alpha schools or something. How are you gonna do that? - I saw you doing the math, Sean. Right, when he said that, I saw him type and I do exactly, he was doing it on his calculator. So, I mean, there's a hundred thousand schools in the US. You know, and back to a billion. Now there's gonna be different ways to get there. One is just physical schools, right? And so I am learning how to scale physical schools, right? This is gonna be, you know, across the nation. Just to give you scale, if you want on the business side of this, you know, private school market in the US is about a hundred billion dollars. So it's a huge market where even if I don't get to public school, we will. But even if I don't get to public school, I have a hundred billion dollar market that gives me a great beach. It's why alpha started, it's why we're hiding private school is because it's you, right? The anchor, right, in the credibility and the revenue, right? That then funds everything out. It's your Tesla Roadster, yeah? Yeah, Tesla Roadster is a great one. So there's that hundred billion dollar market and that's US K-12. How long does that take to make a profit? And are you just using your money? Yeah, so I put in a billion dollars for my software company as the first payment. But back to this, getting to a billion kids is gonna take tens of billions of dollars. So fixing education is a multi trillion dollar industry, right? It's the second largest industry besides healthcare, globally. And there's nothing there, right? It's there's no, there's no private market players, really. And so, you know, there is definitely the opportunity to build SpaceX for education. And so, and the capital requirements are high. You want all these campuses? Now, we're busy innovating on the business model to show that you can build a profitable business so that capitalism can buy the capital needed to scale education, right? Historically, everything in education's been nonprofit. And the problem with nonprofits is nonprofits are non-scalable, which is the better your product, the faster your donations go away, right? There's plenty of really good charter schools who have 3,000 person wait lists. And if you pass their head of their school, we'll want to show up in another one. And they're like, I'm waiting on a $40 million donation, you know, to build an encampage. I don't have that problem because I have 1,000 families in New York City at the info session, right? Who as soon as I want capital to build a new campus, right? I'm fun to get right now, but everybody's gonna be happy to give me capital to build the business. Second, you know, and thinking about alpha, alpha is the high end pride pool. You should think Stanford of K through 12, there'll be a couple hundred locations, thousand kids, you know, K 12 locations, but it's five percent of the market. You know, we have other physical schools around Austin that we're incubating to figure out where we get product market fit. We have a gifted school. They're trying to find the 100,000 smartest kids who, you know, when you say what would make you love school, they're like more academics, right? One in 20 kids when you ask them that is like more academics. They want a third power hour in the app, they want math, Olympiad, right? They want all that. We have a sports academy, right? This is like 40% of the market, maybe 50% of the market, which is when you say what would you love to do kids or like sports? So like Texas sports academy, you know, our baseball team, just one national championship, the IMG, if you know, right? Our basketball team is for one, you know, our academics are 10 times better than our G's. We're rolling out a set of other sports that you'll see for August, where these teams will be the best in the country, but also the best academics, sort of, you know, now for Premier academics, but also sports. And so we're working on, you know, I don't know what you've heard of founders school yet, that we're building for high school. And so we're building all these different school types, but those are, you should think physical schools. And my view of the market is in 20 years, AI is gonna change the world in a lot of ways, but in 20 years, parents are gonna drop their kids off at a building, 90% of parents, you have homeschooled little stuff, but it's a niche. 90% of parents are gonna drop their kids off at a building. And in that building are other kids and adults, right? That's one of the most, you know, there's a road but terminator, so it's not. Right? Kids need adults to develop them, right? And now if we do our job, right, what occurs during six hours is totally different, right? We totally transform it in the last 100 years, but that's the market. And we have to bring the physical school. Now how do I get to a billion kids, you know, that it's gonna take 20 years is not enough to build that many schools? So we're working on other products, one, just the time backs offer itself, where if I can go get people who want to build schools or transform their schools, and they realize this is an ed tech, right? Ed tech failed. The second is we're doing stuff outside of school. So to give you one example, we have some of the world's best video game developers, right? Building and they're spending two years building a video game on these concepts, right? And it will be free to learn, you know, think free to play, free to learn for 500 million kids, and it'll start shipping later this year. Why? Like why do this? Like you're incredibly wealthy. And then also like you're kind of a shark, not a bad way. You're a tycoon, you're a Titan of industry. You're like a take over the world type of guy. Why school? This is a great question, which is, you know, before I did this and put my billion dollars in, I talked to a dozen billionaires who'd all spent over at all, spent over a billion dollars on education. And to a person, every single person said, don't do it. And they're like, it's the lowest ROI you can get, maybe fill in throughout the thing. It doesn't affect it. There's just no, you just can't impact it, right? It's just this impossible problem. And like every dumb entrepreneur or good entrepreneur, right? I'm like, I'll be different, you know? And for me, it was one where, you know, I just had this experience, which was, you know, I'm back to the life story. So I was doing the AI, I have my software company, right? Big, we're making tons of money, aisles of cash flow, right? Plenty of money. But well, years ago, in Austin, McKinsey and Brian started this school alpha. And McKinsey's like, I'm on over to alpha. And I'm like, I'm not going to your weird school. That is a weird, janky school. And, you know, it took her two years to convince me. And the only way she did was at the, you were in May, at the end of May, the Gabriel gets out. And alpha was still in session. She grants my two daughters to spend a week, you know, before they went to summer camp. And they went to spend a week and they came home after the week. They're like, Dad, I don't want to go to summer camp. We want to go back to alpha. And that was my insight. That was 10 years ago. And then I sat and just talked to McKinsey, you know, well, they're kids, I'm like, this is great for Austin, great for our families. Too bad it doesn't scale. The stuff just doesn't scale. And then four years ago when Jenna, I came out, I was like, ah, neural nets right from my high school. They're finally here. And I was like, this will enable alpha to scale to a billion kids. Just back to fixing education. First off, you need tons of capital. You need somebody who can sit and say, I need a billion dollars. I'm the most well-funded principal in history. Right? No, if he's going to fund Ed Tech, Ed all the Ed Tech stuff's failed. Right? It's never worked. Right? Every, all the billionaires are like done with the plants beyond it. And so I sort of just woke up and I'm like, I actually do have the skills, I think, to go try this. And now I can tell you four years later, I'm four years into it, it was the best decision ever. Like my job today is so much better than my trilogy job. Like not even close. I went, four years ago, I went to my team. I'm like, for 25 years, you guys have been telling me how much better you are than me and, you know, because of great. I'm like, so good luck. Is the company better now? now that you have a new CEO. And well, two part. Well, yeah, it's, it's the, I And so I said, guys, it happened to be your worst shareholder you've ever thought about, which is, you know, I'm like, I'm just going to pull every dividend that I can out because I need the fund education. So we're an acquisition company and I have to turn you from being capital-intensive, buying companies and turning them around to being capital-light, but somehow still making all those actors this work because I'm going to be sucking all the capital for education. And on the face of it, everybody's like, okay, that seems like an impossible problem. The team actually has done a fabulous job better than I had ever thought of of how to do be super capital-efficient. The downturn in SaaS really helps them because there's lots of companies now if you want to just know their business, what's happened is we're considered one of the best operators of SaaS, right? We know how to generate cash flow out of this. This is better than anybody. And so they're bowing to all the SaaS companies that have died that are now owned by the private credit, right? The black stones, the black rocks, or where you're hearing about why the market cap in SaaS is down 90%. And they go to them and they say, look, you have two choices. You either can put another 100, 200 million into this SaaS company that's gone bankrupt and reboot it, or you can just sell it to us for a dollar and we'll split the cash flow. And four years ago, when they did this pitch, I was like, yeah, I'm not doing that because I'm going to give another 100 million dollars to this big, you know, the private equity firms, they have a lot of companies in their portfolios that they're just turning over to the credit guys. And those guys feel four years ago at faith and hope, you know, the last 12 months have completely changed. They're like, oh my god, AI is here. Guys aren't going to last at all. The last thing I want to do is write a big check and hope they can reboot for AI. And they're like, looks like just getting the cash flow is the best thing we can do. So now I haven't seen the last pipeline, last round, they saw $20 billion of pipeline companies that were, they were looking at about splitting the cash flows and buying for a dollar. So they did a great job. How did you get into buying companies in the first place? So you start trilogy, you're an entrepreneur, you got a product, you're selling it, you're doing that game. Why did you, what triggered you to start saying, let's go acquire other companies? What was the moment? Two parts. After the dot com meltdown, 50% of our customers went out of business and you know, 2000 in the dot com turn down, there was two parts that happened. The configuration market, our original market, we had tapped out, right? We dominated it as full. And then during the downturn, we saw that we're just better operators than the other people. We were able to go through it, make profit. All these other software companies were not making that transition. They were dying, right? And they were available for a dollar, right? We could buy all these companies for nothing. So we just literally was like, okay, well, let's buy a couple and see if we can turn them around and get, and we made tons of money. I'm like, okay, let's do this. So we bought hundreds of companies since then. But it was nothing. It did strategy was just like, oh, wow, companies are really cheap on one bottom. I heard that you studied Warren Buffett intensely. My journey on this is I had been investing since high school and at Stanford, I was in the fund. I started to Stanford Endowment, and I came out of it during the 90s and the boom. I'm all like, oh, I'm so great. I remember 98, like reading an interview with Warren Buffett. I remember when we were thinking, man, that guy's an idiot. Then after 2001, I was like, oh, maybe I'm the idiot. Maybe I don't know what I'm doing, right? My returns weren't good, right? It's really good on the way up, but after the bus, life to date, were terrible. And so I was like, I should probably listen to him. And so I literally just read everything. So there was not a book or anything back to my standard of being an expert. Being an expert, if you're going to be an entrepreneur, you have to be the best world in whatever your field is. And so my standard book, well, here's what I need to do. I need to know everything about Warren Buffett so that if I'm watching him being interviewed, I can pause it and answer the question the way he would because I know what he thinks, right? The way he thinks. And so I literally, that's what I do, is we do the same thing with our Alpha High students where we're like, the next bird is one of our pillars. And then when you'd say something that I didn't, you know, they're like, oh, I'm surprised, right? I would then have to go back and research and figure out why I didn't understand it. I love talking to people like you who, like, we have Darmass Shah. He's the founder of HubSpot. And he's like, I'm just, because he has got the story where he's like, I'm the best ping-pong player there is. Like one time someone wanted to play ping-pong with him and he got beat and he's like, oh, I want to be the best because he's competitive. Some people, it's a board game where they just love winning the board game. What's your thing? If I'm going to do it, it is just why not be the best. It's just, well, why would you do the other? Right? Is your other alternative? Well, what about you, though? This is actually interesting. Are you using Alpha, like, what learning techniques have you learned all along the way that you yourself are using to learn? Sure. Our framework about how to beat XRD is, you know, you dive in, right? Our students do the same thing. I do the same thing our students do, which is you spend one hour a day reading and then summarizing, right? Their work. So we've created a structure called a brain lift, which is we think a lot about is what is the role of humans and what is the role of AI going forward? Like, if you're a kid or a mom, you're like, are you preparing my kid for the AI, you know, the AI age coming? We think a lot about that, right? Of how, what is the role that humans are going to play as AI's keeping getting smarter? And so we have a concept in learning science. There's these concepts of depth of knowledge, right? Which is sort of the hierarchy of knowledge, which is DOK1 is facts, right? Do you know facts? DOK2 is, you summarize them, right? Do you have summaries of the facts? DOK3 is, if you look at all those facts and summaries, can you have insults? And then DOK4 is really creating new knowledge, right? Oh, I have insights that no one else has because of this. And LLMs are very good at helping you do DOK1, 2, and 3, right? And reasoning around that. And then the part that the humans still do really well is DOK4 creating new knowledge. And so what we do every day is we spend that I'm reading the current experts that are helping fill your DOK1 and DOK2, right, in the spring lift. And then you are having DOK3, I'm having insights on it. Kids can learn 10 times faster is an insult, right? Based on the learning science facts, right? You can just derive that. DOK4 is insights that are so counter to what, you know, what do you think that no one else believes? So this would be the equivalent of, if I asked in LLMs, help me design a school. It's going to put a teacher in front of a classroom. And if I say, wait, I want to design a school that doesn't have teachers doing academic teaching. The LLMs are going to reject it and say that's unethical. And so AI is not able to help me. If I load my brain lift, basically it's context on top of the LLM, where it has the DOK1 facts, the DOK2 summaries, DOK3 and stuff, all on research papers, all this stuff. And they wait, read all this, take this into context, now does not help me design a school. It's like, oh, yeah, actually based on this, I totally see how alpha can work. And then it actually can help me, right? That is the skill we think is critical. We start teaching in high school. But as it's summarized in, you spend an hour, you personally are spending an hour a day and then you're literally just summarizing what you're saying. And then do you write out like, here's my insights and my new ideas based on what I've just read for this last hour? Yeah, I will, I'll change my brain lift. So for me, how I actually lies it is, I basically have a Twitter of a custom timeline of content and authors, right? Or experts like ongoing science, right? I'm going to go read it and see if there's anything new in there, or I'm going to summarize the article and put it in the brain lift. And then if it causes me to have new insights, I'm going to, I try to have one DOK3 insight, you know, a day as my standard doesn't happen all the time, but that's what I'm trying for. You know, DOK4 are ones, these are the big ones, right? And then you have that knowledge. And if you work that way, right, of having expertise, right? Any feel that you want to be an expert in, right? And AI's help you do this, you know, back in the 90s, I did the same thing, which is I would sit in Stanford's math CS library, you know, in 1989, you know, when I'm dropping out, and I would read every paper written about configurators, right? Of how they tried, why they failed, you know, back then it took forever. You'd have to send, you know, to the, you have to enter Germany, Daimler had really good configuration stuff, right? And they'd have to send you the paper over, you know, and you'd get it a week later. Now literally on an LLM, right? You can learn this stuff really quickly. Dude, how are we going to, how are we going to convince people to buy shit they don't need or do stuff that they shouldn't do if everyone's a super baby and really smart? Right. Like, there's like, what's the world look like whenever it's skinnier? What's the world look like when everyone has access to AI? What's the world look like when a billion people are smarter than they are now by a significant amount? Well, I actually believe, you know, back to this whole thing is I believe the human knowledge graph. I know there's this dystopian view that AI is going to cause everybody to be dumb. And if we do it the wrong way, it's just to be clear. If you take Chop Chop box on unmanaged Chromebook and deploying to kids in K through 12, those These are not learning. Chapats are cheap bots, it's terrible. I understand why people want to ban AI and do all that stuff. Now, there's also a good way to do it. There's in our way, very different way. I believe we should be teaching all the kids good way, because they can learn 10 times faster. We have a student who's going to be published in nature. She will be the first school student as a lead researcher published in nature. That used to be a PhD from Stanford. We are pulling that capability down to a 17-year-old girl. There's 10 people at Alpha right behind her who are like, "Oh, she can do what I can do it." And that concept of unlocking human potential, we haven't even scratched the surface of what you can do. If you talk to our sports academy, as an example, because of the two hours a day in the morning, and you get skills training in afternoon, our sports academy guys are like, "We're going to be in every field. We're going to be the number one team in the country within a year of deciding that's going to be our sport." But how are you going to do that with sports? How are you going to make someone 7 feet tall? You know what I mean? Like, to be good at basketball? You have on all things, right? There's human limitations, right? I can't even with my learned 10-- there's knowledge, there's the IQ, right? And I can't be a nuclear physicist. I just don't have the cycles, right? Actually, in cognitive load theory, I don't have the working memory, right? As you get older, you get slower. Like, my brain, my neurons, fire at about half the speed of my daughter, my 18-year-old daughter. Now, the difference is, I have a knowledge graph, right? In my brain that I uploaded, you know, the last, you know, 50 plus years, that allows me to take shortcuts, because I know the answer. I don't have to think through. So, in a list of 10 things, she has to go through each one. I can read the 10 things and be like, oh, seven's the answer. So, I can still get to it, but you have to load knowledge into your brain, even as your brain slows down, as you get older, or even if you don't have the fastest brain to start with. So, I can't make people seven feet tall. They're not going to win, you know, the NBA. But whatever the boundary of your human potential is, we can get you there, right? We can get you to the boundary. And what the surprising part is, your expectation of what your boundary is, or what your kid's boundary is, is wrong. That's where when you talk about the excitement, the energy, and why I get up every day to do this, is I literally am surrounded by kids who are just doing magical stuff. And you know, we have to get it out to everybody, right? There's nothing more important to society than raising the next generation. Every parent, right? That's your job, every society. That's the most important job. There is nothing more important. We haven't had an answer for 100 years or a way to change it. We now do. And it needs not just to be me, right? I have to go get all the best people in the world to work on this problem because it's more important than all the other ones. I can see why you outrecruited Bill Gates. I'm in. Where do I sign up? Well, come on, I'm going to show you, I'm going to go back to your audience, right? Of people who want to start businesses. I haven't done it yet because I'm still working on exactly the business model and the go-to-markets to prove it. But I'm going to show this is the single best market if you're an entrepreneur to enter. It's a multi-trillion dollar market with no competitors. Dude, is the Catholic Church going to be like, is it going to get like the Pope knocking on your door and like, "Hey, Joe, what are you doing?" They know we are working back to this, back to school. So there are Catholic schools that I'm working with who are like, how do we adopt to our learning? Because it's just so obvious that no matter what you want, you know, the Catholic Church has a different afternoon they want. Right. Everybody has their afternoon they want. But everybody gets, okay, well, we're wasting the kids' timing class. Let's get that two-hour learning thing working so that we can then build the afternoon that we think our kids will thrive in. Sean, is your cup full or what? Oh my gosh. Yeah, this is amazing. I loved it. I love the stories. I love the insights. I love what you're doing. We're big fans. We've been talking about Alpha for a while, so it's fun to have you here. Thanks for coming on. Thanks for appreciating it. You're the man. We appreciate you. That's it. That's the pod. Hey, let's take a quick break. I want to tell you about a podcast that you could check out. It is called The Science of Scaling by Mark Rebehrs. He was the founding CEO of HubSpot. And he's a guest lecturer at Harvard Business School, the Guy Smart. And he sits down every week with different sales leaders from cool companies like Klavio, Invanta, and OpenAI. And he's asking about their strategies, their tactics, and how they're growing their companies as head of sales or chief revenue officer. If you're looking at a scale of company up, if you're a CRO or head of sales just looking to level up in your career, I think a podcast like this could be great for you. Listen to The Science of Scaling wherever you get your podcasts.

Podcast Summary

Key Points:

  1. A billionaire entrepreneur who dropped out of college and built multiple billion-dollar companies in the 1990s, including Trilogy which created the first AI product to sell $1 billion.
  2. He disappeared from public life for 20 years after getting married in 2005, and is now returning to reinvent education using his own $1 billion investment through a program called Alpha.
  3. Alpha features extreme challenges for children, such as kindergartners climbing 40-foot rock walls, second graders running 5Ks, and eighth graders completing tough mudders.
  4. The entrepreneur emphasizes intensity, risk-taking, and high standards over ease, using unconventional tactics like requiring recruits to bet a month's salary in Vegas to test their risk tolerance.
  5. Trilogy’s success came from selling complex configurator software to Fortune 500 companies, often as a last resort due to high pricing, and from out-recruiting Microsoft for top graduates by offering a hard, meaningful experience.

Summary:

This transcription features a conversation with a billionaire entrepreneur who founded Trilogy in the 1990s, an AI company that sold the first billion-dollar AI product using configurator software for complex manufacturing. After dropping out of Stanford, he built multiple billion-dollar companies, appeared on Forbes at 27, then disappeared for 20 years following his marriage. He is now returning to reinvent education with his own $1 billion investment through Alpha, a program that challenges children with rigorous physical and mental tests, such as kindergartners climbing 40-foot rock walls and second graders running 5Ks.

He emphasizes that young people want hard, meaningful experiences rather than ease, which allowed Trilogy to out-recruit Microsoft for top graduates by offering intensive training like Trilogy University, which included a swap program with Navy SEALs. He also used unconventional recruiting tactics, such as requiring recruits to bet a month's salary in Vegas to test their risk tolerance. The entrepreneur attributes his success to intense focus, a willingness to do whatever it takes to achieve goals, and learning business principles from his father, a strategic planner at GE.

He believes this same intensity and product management approach can transform education.

FAQs

The alpha sentence is that kindergarteners must climb a 40-foot rock wall and pass a 'receive critical feedback without crying' test, highlighting a focus on hard challenges.

The guest is a billionaire entrepreneur who dropped out of college in his 20s, built multi-billion dollar companies like Trilogy, and then disappeared for 20 years before returning to reinvent education with his own money.

Trilogy's first product was a configurator, a software that helped sales reps sell complex products like airplanes or phone switches by ensuring correct configurations, saving Fortune 500 companies millions.

He competed by emphasizing that Trilogy offered a harder, more significant experience, and he personally engaged candidates, even challenging Bill Gates by offering ski trips and highlighting Gates' limited availability.

During Trilogy University, recruits had to bet one month's salary on a roulette number to demonstrate risk-taking, which was seen as essential for entrepreneurs seeking venture capital.

He believed young, ambitious people want hard challenges, not ease, so making it the hardest 100 days of their lives attracted top talent against companies like Microsoft.

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